Hey there, crypto fans! If you’ve been scrolling through X lately, you might’ve stumbled across an eye-catching thread by Maxx (@Max_Sunxxx) posted on March 8, 2025. This deep dive into the world of crypto market makers (or “MMs”) has sparked a lot of buzz, especially for project founders and traders navigating the wild crypto landscape. Let’s break it down in plain English and see what Maxx’s insights mean for the industry in 2025.

What’s a Market Maker, Anyway?

First things first—let’s clarify what a market maker is. In crypto (and traditional finance), market makers are companies or individuals who help keep markets running smoothly by providing liquidity. Think of them as the “traffic cops” of trading: they place buy and sell orders on exchanges to ensure there’s always someone ready to trade, making it easier for you to buy or sell your coins without crazy price swings.

Maxx explains there are two main types:

• Active Market Makers: These folks aren’t just sitting back—they actively manipulate prices, pulling strings to push prices up or down. It’s a bit like playing puppet master, and it can be risky for regular traders or projects. Maxx notes some of these players have gotten into hot water with regulators, like the FBI cracking down on firms like ZMQ and Gotbit for shady practices.
• Passive Market Makers: These are the “good guys” (or at least, the more regulated ones). They focus on keeping things stable by placing balanced buy and sell orders, helping maintain market depth without rocking the boat. Maxx works with passive market makers at MetalphaPro, and he emphasizes they’re all about providing steady liquidity, not wild price swings.

Why This Matters in 2025

Maxx’s thread comes at a pivotal time. He mentions the crypto market in 2024–2025 is split into three zones:

• Top Tier (BTC and Big Players)​: Bitcoin’s doing great, with tons of liquidity and institutions piling in. Miners are happy, and prices are holding strong, even with some recent dips.
• Bottom Tier (Meme Coins and PVP)​: The wild west of pump-and-dump coins on platforms like Solana and Base is buzzing with activity—some folks are losing big, while insiders are cashing in.
• Waist Tier (Mid-Sized Projects)​: This is where things get tricky. Maxx says mid-sized tokens—those with market caps in the tens or hundreds of millions—are struggling. Liquidity is drying up, and many new coins listed on big exchanges like Binance, OKX, or Bybit see their trading volume tank within months. For project founders, this means relying on market makers to kickstart liquidity when their tokens launch—or risk a total crash.

The Drama with GoPlus Security (GPS)

Maxx’s thread kicks off with a hot topic: Binance slapping a “Monitoring Tag” on GoPlus Security’s (GPS) token. On March 7, 2025, a market maker sold off 70 million GPS coins, pocketing around 5 million USDT. This move raised red flags, prompting Binance to investigate and tag the token for extra scrutiny. It’s a wake-up call about how market makers can influence prices—and not always in a good way.

Maxx doesn’t dive deep into the GPS case (he leaves that to Binance and the project), but he uses it as a springboard to talk about the broader issues project founders face. Many are juggling fundraising, pivoting their strategies, and negotiating with exchanges, all while worrying about their token’s price after launch. It’s a stressful gig, and market makers can either be allies or adversaries.

How Market Makers Work: The Nitty-Gritty

Maxx breaks down how market makers operate, focusing on the two big models:

1. Token Loan Model: Projects lend their tokens to a market maker for a set time (say, a few months). The market maker uses these tokens to place orders, ensuring liquidity. In return, they might get an “option” (a financial agreement) that lets them profit if the token’s price moves in a certain way. Maxx says the profit’s usually small—maybe 3% of the token value, plus tiny fees from price spreads—but it’s enough to keep them in business.

2. Retainer Model: Here, the project keeps its tokens but pays the market maker a monthly fee to manage liquidity via an API connection. The project retains control, but it’s on the hook for any losses if trading goes south. This is safer for projects wary of giving up their coins but can be costlier.

Maxx warns about common pitfalls, like thinking market makers can “pump” prices or “draw lines” to manipulate charts. Passive market makers, he stresses, aren’t supposed to do that—they’re just there to keep the market flowing. But some bad apples (especially active market makers) have given the industry a bad name by pulling stunts like selling off tokens early to cash in before prices crash.

Challenges and Red Flags

The crypto world in 2025, according to Maxx, is a “dark forest” for projects. With liquidity scarce in the waist tier, market makers hold a lot of power—especially at launch, when “opening liquidity” (the initial trading volume) can make or break a token. But this power can lead to trouble:

• Liquidity Pulls and Dumps: Some market makers might pull out liquidity or dump tokens, betting the project will fail. Maxx calls this unethical and risky, but it happens because the incentives can be misaligned—market makers might profit more by betting against a project than supporting it.
• Lack of Regulation: While things are getting better, crypto’s still a Wild West. Maxx points out that only exchanges like Binance have the data to catch bad behavior, but they’re often reluctant to share it due to client privacy and big fees from market makers.
• Project Founder Stress: Maxx paints a picture of founders burning out, juggling investors, exchanges, and market makers while praying their token doesn’t flop. It’s a tough spot, and many don’t fully understand how market makers work, leaving them vulnerable.

Maxx’s Tips for Picking a Market Maker

If you’re a project founder, Maxx has some solid advice:

• Don’t Just Chase Liquidity KPIs: Those metrics (like how deep the buy/sell orders are) look good on paper, but they’re hard to verify. Focus on trust and transparency instead.
• Diversify Your Market Makers: Don’t put all your eggs in one basket. Work with 2–4 firms to compare terms and hedge your risks.
• Token Loan vs. Retainer: Choose based on your needs. If you want control, go for retainer; if you need quick liquidity, token loans might work—but watch out for risks.
• Be the Boss: You’re the client, so negotiate hard. Compare terms, ask tough questions, and don’t let market makers push you around.

Maxx admits the industry can feel dirty at times, but he’s optimistic. With more regulation and education, market makers could shed their “villain” image and become true partners for projects.

Why This Thread Resonates

Maxx’s post isn’t just a rant—it’s a heartfelt guide from someone who’s been in the trenches. As a 00s-born crypto vet, he’s seen the industry evolve from chaotic early days to a more regulated but still challenging space. His thread has sparked reactions on X, with folks asking for jobs in market making, praising the depth, or seeking partnerships. It’s clear this topic hits home for many in the crypto community.

If you’re into crypto, this thread is a goldmine of insider knowledge. Whether you’re a trader, a founder, or just curious, Maxx’s breakdown helps demystify a crucial part of the ecosystem. And with Binance’s GPS move making headlines, it’s a timely reminder of the stakes involved.

So, what do you think? Have you had experiences with market makers, good or bad? Drop your thoughts in the comments—I’d love to hear from you!